#DISRUPTMINING: ACOUSTIC ZOOM TAKES TOP PRIZE IN GOLDCORP COMPETITION / 3 Geotech_Earlug_2016_Alt2.pdf 1 2016-06-24 4:27:20 PM
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COLOMBIA, ECUADOR & PERU Juniors chase gold, copper, zinc & more in northwest South America / 9–15
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MARCH 19–APRIL 1, 2018 / VOL. 104 ISSUE 6 / GLOBAL MINING NEWS · SINCE 1915 / $3.99 / WWW.NORTHERNMINER.COM
Bankers on lessons learned, exploration, finance trends
Tianqi to build world’s largest spodumene converter LITHIUM
| New plant could attract more battery makers to Australia
PDAC 2018
| New funding models propelling firms of all shapes and sizes BY TRISH SAYWELL tsaywell@northernminer.com
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trategic private placements, private equity and joint-venture partnerships are playing a bigger role in financing exploration and development projects in the mining sector, a group of Canadian bankers agreed during a panel discussion at the Prospectors & Developers Association of Canada convention in Toronto. “It’s a pretty interesting shift both on how juniors are trying to finance their business and also how larger companies are trying to grow,” Chris Gratias of CIBC Capital Markets said in his opening remarks. If you look at the amount of capital raised between 2013 and 2015 by the juniors — companies he categorized as having a less than $500-million market capitalization — 80–85% of it would have come from the public markets or investors, he said, and 15% would have come from strategic private placements. In the last 12–18 months, by contrast, 60% has come from strategic private placements and 40% from the public markets. “Through the last cycle I would say a lot of the development was funded through the equity markets, and I don’t think that will be the case through this next cycle going forward, and that has caused alternative forms of capital to position themselves,” he said. “We’ve seen an increased presence of private equity that is providing alternative forms of capital, we’ve seen pension funds and sovereign wealth funds spending their time in the space, and, very interestingly, we’ve seen the corporates playing a financing role for the junior market. We call these strategic private placements — it’s almost an alternative form of exploration. Instead of doing it in-house, they’re outsourcing it by backing a junior public company.” That doesn’t mean the public marSee PDAC / 6
Tianqi Lithium’s lithium hydroxide processing plant under construction, photographed in January 2018, in Kwinana, Western Australia. TIANQI LITHIUM BY TRISH SAYWELL
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tsaywell@northernminer.com
ianqi Lithium Australia, a subsidiary of China’s Tianqi Lithium, has started building a state-of-the-art spodumene converter that will produce batterygrade lithium hydroxide in Kwinana, Western Australia. Initial production is expected by mid-2019, with sales before the end of 2019, according to a new report by Wood Mackenzie, a research and consultancy business for the global energy, chemicals, metals and mining industries. Once in full production, Kwinana will be the largest lithium hydroxide-producing operation and the biggest converter in the world, James Whiteside, a London-based managing consultant at Wood Mackenzie and author of the report, says in an interview. The plant will use high-grade lithium concentrate feedstock sourced from Greenbushes, the hard-rock lithium mine in southwestern Australia that Tianqi acquired in 2013–2014, and jointventured with Albemarle (NYSE:
“IT’S A MASSIVE DIFFERENCE — IT CHANGES THE FACE OF THE INDUSTRY ... LOWER CONVERSION COSTS AT INTEGRATED PRODUCERS COULD CHANGE THE COST STRUCTURE OF THE ENTIRE LITHIUM-MINING INDUSTRY.”
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JAMES WHITESIDE MANAGING CONSULTANT, WOOD MACKENZIE
ALB), the mine operator. Greenbushes’ current capacity is 80,000 tonnes of lithium carbonate equivalent (LCE), with plans to expand to 180,000 tonnes LCE in the early 2020s, Whiteside says in his research note. The mine produces multiple spodumene concentrates and they average 6% lithium oxide. Then, at Kwinana, the concentrate will be converted to lithium hydroxide, which can be used in battery materials for the electric vehicle and energy-storage markets. The new plant is “likely to change the cost profile for lithium conversion,” Whiteside says. “All spodumene conversion cur-
rently happens in China, where total conversion costs are around US$6,000 per tonne for lithium hydroxide,” Whiteside says, adding that China has to import most of the spodumene it requires, which contributes to the higher cost. At the moment, making lithium hydroxide from hard rock spodumene mines and brines is fifty-fifty, Whiteside tells The Northern Miner, but by 2025 he says two-thirds of it will come from spodumene operations. With lithium brine operations, he says, the lithium is processed into carbonate first. See TIANQI / 2
ECUADOR: MINES MINISTER SEEKS TO ELIMINATE WINDFALL TAX / 13
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